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Update on EPA’s Rule 111(d) – Clean Power Plan

In recent months, a heated debate over EPA power plant rules has arisen. The rule, which is called the Clean Power Plan or Rule 111(d), was published in June of 2014 and will be made final in June of 2015. The gist of the rule requires each state, on a state-by-state basis, to develop a plan to meet EPA published limits on CO2 output. The effect of this rule will be to substantially limit the CO2 output from the moderate to higher producing power plants by forcing them to cut back or shut down completely and replace them with new natural gas and/or renewable units.

Upshur Rural Electric purchases power from the East Texas Electric Cooperative (ETEC) and the Northeast Texas Electric Cooperative (NTEC) who in turn purchase power from various generating entities including coal power plants. In response to the passage of Rule 111(d), ETEC and NTEC have filed the following comments with the EPA: Edd Hargett, General Manager of ETEC, said, “Unfortunately, ETEC is currently facing a regulatory assault on its ability to provide economic power to the members of our cooperative. Compliance with the proposed EPA regulations for power plant emissions are estimated to cost ETEC approximately $2.9 billion.

Moreover, the compliance timelines proposed by the EPA do not provide sufficient time for utilities to either develop new, cleaner power resources or construct transmission to access alternative supplies. “Rick Tyler, General Manager of NTEC, said, “We are particularly concerned with the impact of this on our member-owners in rural East Texas, who are especially vulnerable to electricity price increases. We estimate that the monthly rate impact will be $35-$40 a month. This is an increase of approximately 30-35% over our members’ current electricity bills.

The Texas Commission on Environmental Quality (TCEQ) and the Railroad Commission (RRC) have also filed the following comments with the EPA: “The Public Utility Commission of Texas’ (PUCT) primary concerns with Proposed Rule 111(d) are that the rule:

1) Will create significant electric reliability problems in Texas;

2) Unfairly penalizes Texas for its success in the early adoption of renewable energy and energy efficiency programs, its diverse fuel mix and its highly successful and competitive electricity market; and

3) Is an unlawful intrusion into areas it has neither the authority nor the expertise to regulate.”

Upshur Rural Electric, like its suppliers and regulatory authorities, is likewise concerned about the rising cost of generation in East Texas. Local governments have estimated that there could be significant job loss and a large reduction in our area tax base in the counties that house the coal power plants that possibly could be shut down. If you want to express your concern, we encourage you to contact your political leaders and local regulatory bodies. For more information, visit nreca.coop.